THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

WOLF BLITZER, CNN ANCHOR: And, to our viewers, you're in THE SITUATION ROOM. Happening now: death during takeoff. Dozens killed in a fiery plane crash, authorities now trying to figure out what went so horribly wrong.

Also, Barack Obama's big decision -- his vice presidential announcement expected soon. And the Democrat is upping the ante today in his face-off with John McCain.

And does Barack Obama need Hillary Clinton now more than ever? We will talk about that and more with the House speaker, Nancy Pelosi. She's standing by live in Denver. We will talk about Clinton's vice presidential prospects and a lot more -- all of that and the best political team on television.

We want to welcome our viewers in the United States and around the world. I'm Wolf Blitzer. You're in THE SITUATION ROOM.

There is now information out this hour about the crash of a Spanish plane at Madrid's main airport. The country's development minister now says 153 people died when the plane went down on takeoff and burst into flames.

CNN's Madrid bureau chief, Al Goodman, has the latest.

(BEGIN VIDEOTAPE)

AL GOODMAN, CNN MADRID BUREAU CHIEF: Indications are the plane crashed towards the end of the runway on takeoff, veering off to the right and going down into a gully.

There are reports of an engine fire, and the fire expanding as the plane was lying in the gully, according to eyewitnesses, and according to what we could see some hours later. Rescue workers rushed in. Airport workers in other jobs pressed into service rushing in. Rescue workers telling us they saw many bodies. They saw few people walking around, many people with burns and injuries.

They pulled blankets out to initially carry away the injured and later put the blankets over the deceased. Rescue workers were said to possibly be searching again in the plane with searchlights, with generators, projecting light onto this charred wreckage, possibly trying to find more bodies. One of the few bright notes this day, two babies reported to have survived this accident in hospital, according to CNN partner station CNN+. At the destination city in the Canary Islands, several hundred people convened, being attended by counselors and psychologists, some of them being flown to Madrid, where there was another team of counselors and psychologists.

The government, the airline company trying help people through what is clearly a very unusual tragedy for this airport, the Interior Ministry telling CNN all indications are that it was an accident.

Al Goodman, CNN, Madrid.

(END VIDEOTAPE)

BLITZER: More than 1,000 MD-80s were built by McDonnell Douglas back in the 1980s and '90s. Hundreds of them are still in the United States -- still in use in the United States by American Airlines and Delta, among others. We're watching this story.

Let's get to the vice presidential guessing game right now -- many Democrats on the edge of their seats. They're waiting for Barack Obama and his big announcement. It could come any time. Obama is gearing up for the in Democratic next week also by sharpening his attacks on John McCain.

CNN's Jessica Yellin has been looking at this story.

He's under a lot of pressure to come out swinging, isn't he, Jessica?

JESSICA YELLIN, CNN CONGRESSIONAL CORRESPONDENT: He is, Wolf.

For weeks, in fact, worried Democratic operatives have been complaining loudly that Obama has not been answering McCain's attacks. Well, now Obama is hitting back.

(BEGIN VIDEOTAPE)

YELLIN (voice-over): Barack Obama, taking aim at John McCain...

SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE: He wants to continue the same economic policies that George Bush has been doing for the last eight years. So my job in this election is to say, I honor his service, but I don't honor his policies.

YELLIN: ... and insisting he's as patriotic as his opponent.

OBAMA: I have never suggested and never will that Senator McCain picks his positions on national security based on politics or personal ambition. I have not suggested it because I believe that he genuinely wants to serve America's national interests. Now it's time for him to acknowledge that I want to do the same.

Let me be clear. I will let no one question my love of this country. YELLIN: McCain has spent weeks challenging Obama's judgment and readiness, and he's managed to almost eliminate the Democrat's lead. So now the Obama campaign is hitting back, trying to change the topic with ads like these...

NARRATOR: John McCain support's Bush's tax cuts for millionaires, but nothing for 100 million households.

NARRATOR: Economics by John McCain support George Bush 95 percent of the time.

NARRATOR: Can we really afford more of the same? John McCain's tax plan for big corporations, $200 billion in new tax breaks.

STU ROTHENBERG, ROTHENBERG POLITICAL REPORT: Somehow the presidential campaign became about Barack Obama when Democrats thought it was going to be about George W. Bush and the state of the economy and Iraq. And so by going on the attack, he hopes to redirect the public's attention to, what's this about? It's about McCain, it's about Bush, it's about the economy.

(END VIDEOTAPE)

YELLIN: Now, two of Obama's top supporters, Wolf, called John McCain's attacks dishonest, desperate gutter politics. That was on a conference call with reporters. It's just a sign that the campaign is trying to let some of the surrogates go even more negative than Barack Obama, so Obama can to some extent try to seem like he's staying above the fray -- Wolf.

BLITZER: Thanks, Jessica, for that.

With only five days to go until the convention, Democrats are starting already to gather in Denver. One of those is the House speaker, Nancy Pelosi.

Madam Speaker, thanks very much for joining us.

REP. NANCY PELOSI (D-CA), SPEAKER OF THE HOUSE: My pleasure.

BLITZER: Are you ready to allow an up-and-down straight vote when you get back to Washington in the House of Representatives whether or not to approve offshore oil drilling?

PELOSI: Well, I thought we were going to talk about the Democrats coming together in Denver. And I will address the question you asked me.

But, first, let me say how excited I am to be here as the chair of this convention, which will demonstrate the unity of the Democrats behind Barack Obama as the next president of the United States and our unity with the American people, addressing their hopes and aspirations, understanding their challenges, presenting solutions relevant to their lives.

Among those is energy independence, as you suggest. And when we come back, we will have a full discussion, as we have been having, about how that energy independence is achieved and what the impact is on consumers.

I will not allow the Republicans to have a hoax on the American people, that, if we drill offshore, the price at the pump will come down, because that simply is not true.

(CROSSTALK)

PELOSI: I will have that discussion of all alternatives that are there to increase our domestic supply, to reduce the cost to our consumers, and to have a redefinition of the relationship between our oil, which is in the Outer Continental Shelf, big oil's profits, which they are not -- they are supposed to share through royalties with the federal government and the taxpayer -- and they do not -- and the subsidies that they are receiving in order to drill.

So, we can have safeguards in offshore drilling and no subsidies. That's the discussion we will have.

BLITZER: Because, as you know, on the Senate side, there's a group of Democrats and Republicans trying to come up with a comprehensive compromise, if you will, that would allow offshore oil drilling, but also get into some of the clean energy, the clean energy issues that you would so much like to see. Is that something you would allow to come up for a vote in the House?

PELOSI: When we come back, you will see our package.

And it's well known I presented it in my response to the president on Saturday. We will be talking about what are the conditions under which there could be drilling in the Outer Continental Shelf with safeguards and no subsidies.

What we have put on the table is a renewable electricity standard. We will talk about use it or lose it. We will talk about releasing oil from the SPRO. We will talk about unending, undue, and dangerous speculation in the oil markets. We will talk about the use of natural gas, which is cleaner, less expensive, and more abundant than fossil fuels, such as oil.

So, we will have an array of issues -- array of proposals that will be renewable, clean alternatives, which the American people overwhelmingly support. And if drilling in the Outer Continental Shelf, with safeguards and without subsidies, is something that the Republicans support, we shall see.

They may want to have a vote on giving big oil everything it wants. If they want that vote, or they say we want just exactly what big oil wants and nothing else, well, maybe we will let them have that vote. And the American people can see whose side they're on, the consumer and the taxpayer, or big oil.

BLITZER: One of the exciting things about the convention -- and you're already there in Denver -- is the vice presidential selection. And we don't know who Barack Obama is going to pick. We do know, though, in our...

PELOSI: I don't know either.

BLITZER: We know, in our latest poll of polls, our average of the major national polls, this race is tightening. There was a six- point lead only the other day for Barack Obama.

Today, only within the past few hours, Obama 45 percent, McCain 44 percent, 11 percent unsure. Are you worried that this race is a whole lot tighter than supposedly it should be?

PELOSI: No, I don't at all, because those polls are based on likely voters. Likely voters are based on past performance, the last two elections.

Barack Obama is going to have a big majority. And it's based not on only what you said, but more than that. It is going to be based on first-time voters and voters who haven't voted in a long time and are coming back to the process, attracted by his message for change, for jobs, for health care, for energy independence, for a safe and secure America, for rebuilding the infrastructure of our country.

I'm very excited about the prospects. I know, at this convention, we will be nominating Barack Obama to be the next president of the United States.

BLITZER: I know we're almost out of time. Quick question. Some say, as these polls tighten, especially in some of those key battleground states like Florida or Pennsylvania, he should take a second look at Hillary Clinton, who did get, after all, some 18 million votes. Would that be smart on his part?

PELOSI: I believe that, if Hillary Clinton were the nominee -- and now Barack Obama is -- that each one of them should have the discretion to name their vice presidential candidate. And I think that will be a decision for Barack Obama to mistake.

And I'm happy to receive the choice that he's comfortable with. And it will be a winning ticket, but not only for the Democrats, but, more importantly, for the American people.

BLITZER: And, if you don't know who that nominee is going to be, we certainly don't know.

JACK CAFFERTY, CNN ANCHOR: Barack Obama wants to give $1 billion to the Republic of Georgia for reconstruction. The United States is already providing humanitarian assistance, as it should. This would be extra.

The proposal actually came from Joe Biden, senator and chairman of the Foreign Relations Committee, who also is rumored to be on Obama's short list for V.P. Biden went to Georgia last week, came back saying the Russian invasion of its neighbor is -- quote -- "one of the significant events to occur in Europe since the end of communism" -- unquote.

Biden is vowing to work with the White House, get this legislation passed, so the U.S. can start spending that money as soon as Congress reconvenes. It's not like we aren't already spending a few dollars overseas, $700 billion a year for imported oil, $200 billion a year for a couple of wars in Iraq and Afghanistan, tens of billions to rebuild Iraq's infrastructure.

Now, apparently, it's time to start boxing up $100 bills and sending them to Mr. Saakashvili, who started this whole dust-up with the Russian bear. I don't think so. We're almost $10 trillion in debt in this country. We have $63 trillion in unfunded liability for our own entitlement programs, things like Medicare, Social Security, $500 billion deficit staring us in the face for next year.

And our own infrastructure is falling down around our ears. I mean, come on. Sure, the Georgians are nice people, but we're busted over here. We're running out of money.

So, here's the question. Should American taxpayers spend $1 billion for reconstruction in the Republic of Georgia? Go to CNN.com/caffertyfile and post a comment on my blog -- Wolf.

BLITZER: Jack, thank you.

And there's a story just coming into CNN right now, U.S. efforts to strike a deal with the government in Iraq on a long-term U.S. military presence there. We will get the latest from the Pentagon.

Also, John McCain keeps Republicans guessing about his vice presidential pick. Why that's making some -- some conservatives nervous. And with Russian tanks still in Georgia, Moscow fires off a new warning about a U.S. missile shield in Poland. Secretary of State Condoleezza Rice says things could get a whole lot worse. We have a CNN exclusive.

Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: And there's a news story coming into CNN, word on the Bush administration's effort to strike a deal on some long-term U.S. military presence in Iraq.

Long let's go straight to our Pentagon correspondent, Barbara Starr.

They have been working on this proposal for a long time, lots at stake, lots of controversy.

What are we hearing right now, Barbara?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, Wolf, this story is still breaking at this hour, but at least a step forward. A senior U.S. military official tells CNN that Iraqi and U.S. negotiators have indeed reached a draft agreement on a way forward for U.S. troops in Iraq.

Now, what we have to emphasize is few details are available. By all accounts, this draft agreement has not gone to the seats of government, if you will. Both the Iraqi government and the U.S. government still must review it, ratify it, and approve it, and reach a financial agreement.

The official tells CNN -- pardon me -- that here's the real key sticking point. The U.S. says there are no specific dates in this agreement for the withdrawal of U.S. troops, that there are time horizons, time frames, but that it would still all be based on conditions on the ground.

The Iraqi deputy foreign minister, however, is still talking about dates, the possibility that next June, U.S. troops will withdraw at least from Iraqi cities and villages, go back to their bases, maybe with a final withdrawal as soon as 2011. So, still, it looks like there is a long way to go to reach a final agreement -- Wolf.

BLITZER: And I know you will watch it every step of the way for us. Barbara, thank you.

John McCain is doing his part to keep up in the war of words with Senator Obama, the Republican now accusing his opponent of getting downright testy. That's a direct quote.

Listen to Senator McCain in New Mexico today talking about Iraq and patriotism.

(BEGIN VIDEO CLIP) MCCAIN: Senator Obama says he wants peace, but he still opposes the surge that succeeded. He opposed the surge. He said that it wouldn't work. He announced his policy towards Iraq the day before he left for the first time in over 900 days to visit Iraq and then refuses to acknowledge that the surge has succeeded. Remarkable. Remarkable.

I mean, no rational observer could go to Iraq and see what we've succeeded in doing in the last two years and say that the surge hasn't succeeded. That's what this is all about, my friends. This is what it's all about, securing our nation. Even in retrospect, with all we know today, he'd still choose the path of retreat and failure.

You know, yesterday, Senator Obama got a little testy on this issue. He said I'm questioning his patriotism. Let me be very clear: I am not questioning his patriotism. I am questioning his judgment. I am questioning his judgment.

(END VIDEO CLIP)

BLITZER: John McCain speaking to voters out in New Mexico earlier today.

We're also learning more about the agenda for the Republican Convention in St. Paul. But there's still plenty of mystery surrounding John McCain's vice presidential pick. And for some conservatives, there is some heartburn as well.

Let's go to Ed Henry. He's working this story for us. And it involves whether or not McCain might actually select someone who supports abortion rights for women.

But, today, Republican voters took those concerns right to John McCain.

(BEGIN VIDEOTAPE)

HENRY (voice-over): In New Mexico, John McCain was twice pressed on whether he will pick a running mate who opposes abortion rights.

UNIDENTIFIED FEMALE: I heard a rumor that you're going to pick a pro-life V.P. Is that true?

UNIDENTIFIED MALE: Are you going to pick a vice president that conservatives can actually rally around in the future?

HENRY: Both times, McCain kept his cards close to the vest.

MCCAIN: I will nominate a person to be vice president, my running mate, who shares my principles, my values, and my priorities. I said on Saturday night that I have a proud pro-life record in Congress. And I am proud of that. (APPLAUSE)

MCCAIN: I respect the views of others.

HENRY: Saturday was the faith forum at Saddleback Church, where McCain won raves from conservatives for speaking out forcefully against abortion. But Republican sources tell CNN conservatives have privately warned that goodwill would evaporate if McCain selects someone who supports abortion rights, like Tom Ridge or Joe Lieberman.

KEVIN MADDEN, REPUBLICAN STRATEGIST: On the issue of abortion and the issue of picking a pro-choice vice president, there is much -- there is a lot more -- I think on this issue there is a lot more risk than there is reward.

HENRY: McCain will walk that tight rope between moderates and conservatives at his convention in St. Paul. Lieberman will speak Monday night, in between Vice President Cheney and President Bush. A remarkable transformation for Lieberman, eight years after accepting the Democratic vice presidential nomination.

SEN. JOSEPH LIEBERMAN (D), CONNECTICUT: I'm glad that the GOP has changed their rhetoric, but you know what? I wish they'd also change their policies.

(END VIDEOTAPE)

HENRY: Now, we're also learning that Tom Ridge will speak on Tuesday night. Mitt Romney will speak Wednesday night at the convention. And Tim Pawlenty, the Minnesota governor, will speak Thursday night.

But McCain officials say don't pay too much attention to the lineup right now. If any one of those guys gets picked as V.P., they will be moved to Wednesday night in prime time, when the vice presidential nominee gets to speak -- Wolf.

BLITZER: They could move that schedule pretty quickly.

HENRY: That's right.

BLITZER: All right, thanks, Ed, for that.

Few signs of an actual pullback. Georgia's president says Russian troops are moving around, but not out. He's calling it a deceptive campaign.

And Central Florida under water. Tropical Storm Fay stalls. We will take a closer look at where it's heading next.

And jobs that can get you killed -- what a new government survey found out in the workplace.

Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK) (NEWS BREAK)

BLITZER: Tensions mounting right now between the United States and Russia. This is not supposed to happen, but it is. The secretary of state, Condoleezza Rice, striking a missile deal in the meantime with Poland, and it's sending a strong message to Moscow. Moscow is responding.

And Condoleezza Rice speaks exclusively to our Zain Verjee. Stand by for that.

The race for the White House tightening right now as the conventions get closer. Is one candidate poised to break away? The best political team on television is standing by.

And Barack Obama easing his way to Denver.

(COMMERCIAL BREAK)

BLITZER: To our viewers, you're in THE SITUATION ROOM.

Happening now, a warning from Russia, as the United States seals the deal on a new missile shield in Moscow's backyard. Russia seeing red as the strain with Washington grows.

Also, just one point now separating Barack Obama and John McCain in our latest poll of polls.

Will their conventions or vice presidential picks help one of them break ahead?

The White House sees early signs of a Russian troop withdrawal from Georgia, but says the pace needs to be stepped up big time. The Georgian president, Mikhail Saakashvili, tells the Associated Press that Russian forces are merely thinning out their presence in some towns, while seizing new territory. And there may be a new flash point. Russia now warning it will go beyond diplomacy in responding to a planned U.S. missile shield in Poland. The secretary of state, Condoleezza Rice, signed that deal today in Warsaw and then she spoke exclusively with our State Department correspondent, Zain Verjee -- Zain.

ZAIN VERJEE, CNN STATE DEPARTMENT CORRESPONDENT: Wolf, Secretary of State Condoleezza Rice insists the United States is not in a cold war with Russia. She did acknowledge, though, in an exclusive interview with CNN, that ties between the two countries have become strained since Russia invaded Georgia. But after she signed a missile defense deal here in Warsaw, that strain could get worse.

(BEGIN VIDEOTAPE)

VERJEE (voice-over): Her signature on a missile defense deal with Poland, Secretary of State Condoleezza Rice put it like this.

CONDOLEEZZA RICE, SECRETARY OF STATE: Missile defense, of course, is aimed at no one.

VERJEE: But the idea of a U.S. missile defense shield in its backyard has Russia seeing red. Now the Kremlin is threatening its former satellite, Poland, with a nuclear attack. In an interview with CNN, Rice warned Moscow -- don't even think about it.

RICE: The Russians must know that we have an Article Five guarantee to Poland as a member of NATO. They must know that the United States would never permit an attack on the territory of an ally.

VERJEE: The U.S. says the 10 interceptor missiles to be based in Poland are to ward off threats from Iran or North Korea. Rice called the timing of the deal coincidental, but her visit, a poke in the eye to Moscow at time the world wants Russian troops out of Georgia.

RICE: The Russian president is beginning to sound like a broken record. First, his troops were going to be out on Monday. Then his troops were going to be out on Wednesday. Now his troops are going to be out on Friday. I'm beginning to wonder if the Russian president is ever going to keep his word.

VERJEE: And Secretary Rice says reports of permanent Russian checkpoints in the Georgian town of Gori violate the cease-fire it signed.

So far, threats of a diplomatic deep freeze have failed to get Russia out. In fact, Russia is now threatening to suspend ties with NATO.

RICE: Sometimes it takes a little time for diplomatic isolation to set in as a fact. Sometimes it takes a little time for a state to weigh the costs of what it's done.

(END VIDEO TAPE)

VERJEE: Secretary Rice says the Russian president is only embarrassing himself by not keeping his word and by not withdrawing Russian troops from Georgia. Secretary Rice also says that in the end, the only thing Russia has gained is isolation and a bad reputation -- Wolf.

BLITZER: All right. Zain.

Zain Verjee reporting for us from Warsaw.

Meanwhile, the race between John McCain and Barack Obama is getting closer -- closer than ever in our latest poll of polls. Joining us now to talk about that and more, Steve Hayes, the senior writer for "The Weekly Standard;" Jack Cafferty, of course; and Susan Page, the Washington bureau chief for "USA Today."

Jack, in our latest poll of polls, it's about as close as it could be -- 45 percent for Obama, 44 percent for McCain, 11 percent unsure.

And what's significant is, what, only days ago, he had, what a 6 or 7 point lead in the same average of the major national polls.

What do you think about that?

CAFFERTY: Well, I think that those -- that 11 percent that's unsure will probability ultimately decide this thing. I think McCain got some benefit out of the reaction that he had to the Russian incursion into Georgia. I think that probably polled well for McCain. And, at the time, Obama was in Hawaii. His response wasn't all that good.

The conventions are right around the corner. Historically, each candidate will get a bounce of around 5 points coming out of the convention.

If you put any faith in the ability of the vice presidential pick to move the needle, the next 10 days or so could be interesting. But it's tight right now.

BLITZER: How tight is it, Susan, date -- not only in the polls -- the national polls -- but in those the key battleground states, like Florida or Ohio or Michigan or Pennsylvania.

SUSAN PAGE, WASHINGTON BUREAU CHIEF, "USA TODAY": You know, no question, Barack Obama has had a bad week. He was off the scene. And John McCain was -- had an open field and able to talk about an issue he has a lot of confidence in, where he has some credibility.

The question is, is this tightening a one week wonder that then kind of reverts to the small Obama lead we saw before or has the McCain team succeeded in defining Obama in some new ways as just a celebrity, as a lightweight, as someone you can't trust as commander- in-chief?

That's the question. And I don't think we'll know the answer to that question until we see a little more time pass and see what happens, as Jack said, during the conventions and after they're over.

BLITZER: A lot of the experts -- the pundits out there, Steve, have been saying you know what, near the end of the Democratic primary process -- it was a long process -- Hillary Clinton was doing much better than she had been doing earlier. And that the McCain folks right now are stealing some of her tricks from her playbook.

Do you buy that?

STEPHEN HAYES, SENIOR WRITER AT "THE WEEKLY STANDARD": Yes. I think it's a sort of a combination of a different strategy and a more aggressive McCain campaign. And, as Susan points out, you know, a changing sense of what's happening on the ground around the world.

And probably the -- if John McCain's campaign could have asked for anything politically to happen, it would have been a major foreign policy issue that they had to deal with that had nothing to do with Iraq and probably had nothing to do with the war on terror.

And it just so happened that Russia invades Georgia.

John McCain has a personal relationship with Mikheil Saakashvili. He knows the issue very well. He's been there a number of times. And I think, you know, at the end of the day, it looks like he really got it right and he got it right early.

So I think that's been a huge sort of wind behind his back. And we're seeing the results of that in these polls.

BLITZER: And, you know...

PAGE: You know...

BLITZER: I was going to say, Susan, a lot of Democrats are really worried -- and I don't know if they should be, but you tell me -- and I want Jack to weigh in, as well -- on, you know, he was saying nothing to do with the war on terror, this crisis between Georgia and Russia.

What if, God forbid, there were some sort of event between now and November for -- involving a terror attack or another appearance by Al Qaeda or whatever?

Who would benefit politically from that?

Because we remember what happened on the eve of the election four years ago, when Osama bin Laden came out with his video. And a lot of people think that helped push Bush over the top.

PAGE: You know, Wolf, there's no question that if in October -- if in mid and late October, terrorism is the number one topic we're talking about on CNN and in "USA Today," that's to John McCain's advantage. But the odds are that we won't be. The odds are we'll be talking about the economy.

Even in the poll -- the Zogby poll that came out today, which showed McCain turning around and going ahead among voters in that poll, showed that half of voters continue to say the economy is the issue that's most important to them.

That is Democratic turf. That is Barack Obama's turf. You saw him today trying to talk not about the situation in Russia and Georgia. Barack Obama was trying to talk about energy prices and the daily costs that people see in their lives in Virginia.

If that's what we're talking about in mid and late October, then I would think this would be territory that's very favorable to Barack Obama.

BLITZER: And Jack?

CAFFERTY: I think it would depend a great deal on the nature of whatever the event was, whether it was against American interests overseas or whether it was against a target here in the United States, how severe it was, how many casualties there were, etc.

I'm not so sure that this time around, if it happens -- and I pray to God it doesn't -- that the American knee jerk response would be, well, let's put some Republicans in charge of everything, because I'm not so sure that that attack on 9/11 didn't serve as an excuse for a lot of the destruction that's happened in this country in the ensuing seven years. And I think the public my some awareness of that.

BLITZER: All right, guys, stand by, because we're going to continue this conversation. Just eight years ago, he was on the Democratic ticket. Now Joe Lieberman -- he's set down to appear at the Republican Convention. His role at the upcoming convention and a possible V.P. slot on the other side of the aisle.

What's going on?

We'll discuss.

Plus, the candidate catches a cold -- to sneeze at when your convention is only days away.

Stay with us.

(COMMERCIAL)

BLITZER: New details tonight on the Republican Convention lineup, including a prominent role for a former Democratic vice presidential candidate.

Steve Hayes, what do you think about this -- Joe Lieberman, a Democrat, he's going to get a prominent role speaking at the Republican Convention in St. Paul?

HAYES: Well, I think for those of us who have been following the campaign closely and the day to day contours of what's been going on on the campaign trail, this is, of course, no surprise. Everybody would have guessed that Joe Lieberman would be speaking on behalf of John McCain.

I think what's interesting is that for the rest of the country who tunes in, typically, after Labor Day or during the conventions, they will see, you know, the guy who was the nominee in 2000 backing the Republican in 2008. And it's a big plus for McCain.

BLITZER: What do you think, Jack?

CAFFERTY: I think that Lieberman better hope McCain wins, because if McCain loses and the Democrats pick up another half a dozen Senate seats, he's going to be in a world of trouble. I mean they let him get away with doing all this stuff now. Remember, in the Democratic primary, he lost in Connecticut. They didn't want him. He ran as an Independent, which is how he got back in the Senate. And he's caucused with the Democrats.

But you can't figure that the Democratic leaders are thrilled with the idea of him getting in bed with the Republicans now. And like I say, he won't be able to get away with this if the Democrats improve their majority in the Senate, so.

BLITZER: He's with the majority as an Independent Democrat. That's what he calls himself, Susan. And he's chairman of an important committee in the Senate.

If the Democrats -- if the Democrats, obviously, retain the majority, as they're likely to do in the Senate, what should they do with Lieberman?

(LAUGHTER)

BLITZER: What do you think?

PAGE: Well, I think he will be in a world of trouble, right. And I want to just note that I agree with Steve. This is a really big deal.

You know the last time someone who was nominated for national office by a party and then campaigned against that party in a subsequent presidential election?

CAFFERTY: No.

PAGE: I think it was Al Smith in 1936 against FDR. So this has been a -- this is a big deal. This is no Zell Miller, who had been a governor, of course, and campaigned at the Republican Convention last time. This is a guy who, eight years ago, was their standard-bearer -- on their national ticket.

BLITZER: It is a pretty amazing development when you think about how times change in the course of eight years. If you're also looking at that convention -- the Republican Convention -- it's not next week, that's the Democrats, but the week after -- you're going to see some prominent Republicans getting good face time in prime time, Steve, like Schwarzenegger and Giuliani, among others. They did a good job for Bush four years ago.

What do you think looking ahead?

HAYES: Well, I think what the McCain campaign wants to do is make this look like a Republican Convention that will appeal to Independents and moderate Democrats. So I think they're going to highlight people like Schwarzenegger, like Rudy Giuliani, like a Joe Lieberman, to send that message, because I think they're pretty well certain that the base is likely to stick with them unless, for instance, John McCain were to pick Joe Lieberman as running mate and then all bets are off, I think.

BLITZER: Jack?

CAFFERTY: I agree. I think that's right. They're trying to populate this thing so that it has some appeal to Independent voters.

I question a little bit highlighting Giuliani. I mean he ran for president. He didn't win a single state. He didn't win a single delegate. He is a, you know, a died in the wool supporter of the president with the 29 percent approval rating. I'm not sure how much attention I'd draw to Giuliani but...

BLITZER: But he's still a pretty good speaker.

CAFFERTY: Well, he's -- yes, he's a good speaker. But he's going to talk about what cost him the votes and the delegates in the primaries, which is terrorism, terrorism, terrorism. That's his deal.

He's got a show coming up right at the top of the hour. He's going to give us a little a preview -- Lou.

LOU DOBBS, HOST, "LOU DOBBS TONIGHT": Wolf, thank you.

We're reporting tonight on a story that you won't believe. A hospital in Chicago that saved the life of an illegal alien at a tremendous expense is now being accused of that patient's family -- by that patient's family of -- you've got it -- discrimination. No thank you, just protests.

Also, a rising threat to our democracy -- the integrity of our voting system in this country. Many state election officials now outsourcing their responsibilities to -- you guessed it -- the very makers of the e-voting machines that are riddled with flaws and not being certified by the states. We'll have a special report.

And we'll be examining the risk of a new cold war with Russia after Russia's aggressive threat to go beyond diplomatic means in its dealings with the West.

We'll be taking a look at a compelling new documentary film tonight about the possibility of economic disaster that could make the Great Depression look like a little downturn in the market.

Join us for that at 7:00 p.m. Eastern, and for all the day's news from an Independent perspective and a great deal more -- Wolf, back to you.

BLITZER: See you in a little while, Lou.

Thank you.

DOBBS: Yes.

BLITZER: So should American taxpayers spend $1 billion for reconstruction in the Republic of Georgia?

A lot of people would like to see $1 billion spent for reconstruction in the State of Georgia.

Jack Cafferty is going through your e-mails. Stand by.

Plus, the most dangerous jobs -- does yours make the list?

Stay with us.

You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Carol Costello is monitoring some other important stories incoming into THE SITUATION ROOM right now.

What's going on -- Carol?

COSTELLO: Well, Wolf, President Bush says hope is coming back to New Orleans. During a trip to New Orleans and Gulfport, Mississippi today, the president noted some $126 billion in aid had poured into the Gulf Coast since Hurricane Katrina hit three years ago. He's agreed to give Louisiana 30 years to repay almost $2 billion need for levee improvements.

Fishing, logging and flying airplanes are the most dangerous jobs in America. That's according to the Bureau of Labor Statistics. The three occupations had the highest death rates in 2007. Nearly 5,500 people died from injuries on the job last year. And that number is down 6 percent from 2006.

That's a look at the headlines.

BLITZER: Still way too many, right?

COSTELLO: Too many, you're right.

BLITZER: All right.

Thanks very much, Carol.

COSTELLO: Sure.

BLITZER: Let's go to Jack.

He's got The Cafferty File -- Jack.

CAFFERTY: The question this hour is should American taxpayers spend a billion dollars billion for reconstruction in the Republic of Georgia? Stephanie in Minneapolis says: "And we're seriously discussing a billion dollars to use for the Republic of Georgia when the Gulf Coast still lies in ruins from Hurricane Katrina?"

Alex in North Carolina: "A problem we didn't create is not a problem we should pay for -- unless we can borrow it from China. Oh, that's right. We've been there and done that. Obama, you just lost a voter." Billy in Las Vegas: "The Russians broke it, let them pay for it. We have enough problems in our own State of Georgia and the other 49. Maybe they can get a loan from the Iraqis. They've got $79 billion sitting around in various banks."

George in Washington: "Yes. If we allow the Russians to reassert their control over the region, a billion dollars will be nothing compared to what we we'll spend out of fear. We'll spend less than we would later if we bail on them stop them now and stop them fast. It's a bargain."

Bill in Tampa writes: "What would a billion dollars do to help support our education system? It would do a lot. Maybe no more schools with asbestos, no more outdated books. The answer is no."

And Rufus in Twenty Nine Palms, California says: "You owe me a new keyboard for my computer. I just spat diet Dr. Pepper all over it when I read this question. It convinced me that you missed your calling as a standup comedian. If we have that kind of money to spend cleaning up Russia's messes, then send me a few billion so I can build that epic Jack Cafferty comedy club in Branson, Missouri -- a monument to the funniest old curmudgeon that ever lived."

If you didn't see your e-mail here, you can go to my blog at CNN.com/caffertyfile and look for yours there among hundreds of others -- Wolf.

BLITZER: All right. Jack, thank you.

See you tomorrow.

On our Political Ticker today, doctors say Congresswoman Stephanie Tubbs Jones of Ohio is in critical condition, with limited brain function after suffering a brain aneurysm. She's in intensive care over at a Cleveland hospital right now. The 58-year-old Democrat was driving her car when she had a brain hemorrhage, which doctors say burst in an inaccessible part of her brain. Stephanie Tubbs Jones is the first African-American woman to represent Ohio in Congress. And we're praying for her, as so many millions are around the country.

Remember, for the latest political news any time, check out CNNPolitics.com. That's also where you can read my latest blog post, as well.